Report Overview with Seth Gerhart Report No. 23-E-0006, The EPA Is Not on Track to Reach Its National Compliance Initiative Goals to Stop Aftermarket Defeat Devices and Tampered Vehicles PODCAST TRANSCRIPT Report Overview with Seth Gerhart Report No. 23-E-0006, The EPA Is Not on Track to Reach Its National Compliance Initiative Goals to Stop Aftermarket Defeat Devices and Tampered Vehicles PODCAST TRANSCRIPT Chad: Hello and welcome to this podcast from the U.S. Environmental Protection Agency’s Office of Inspector General, or OIG. I’m Chad Garland. The EPA has said that illegal hardware and software modifications designed to sidestep emissions controls on vehicles and engines are a significant contributor to air pollution, which harms public health and hampers government efforts to meet air quality standards. But a new OIG evaluation found that the EPA is not on track to reach its own goals for stopping the manufacture, sale, and installation of these illegal components. Joining me to talk about the OIG findings today is Seth Gerhart, a program analyst from the OIG’s Office of Special Review and Evaluation. Thank you for being here, Seth. Seth: Thanks for having me, Chad. Chad: Seth, your team released a report that found a host of issues related to how the EPA has planned and measured progress toward goals the Agency set itself three years ago for stopping these aftermarket defeat devices. First off, what is an aftermarket defeat device? Seth: Well, to explain that I first need to give a bit of background information. Vehicle manufacturers incorporate emissions controls into their engines and vehicles to comply with EPA standards under the Clean Air Act and so that the EPA can certify them for sale in the United States. Those controls can include filters and catalysts, as well as software that controls engine performance. The term aftermarket defeat device applies to any device that’s designed to bypass emissions controls and that’s installed on a vehicle or vehicle engine after it’s been manufactured. So, they defeat those manufacturer controls. The Act makes it illegal for any person to make, sell, or install aftermarket defeat devices, or to do what’s known as tampering, which in the context of the Clean Air Act means removing or altering emissions controls. Chad: We’re talking about things like adding performance tuning kits that hack emissions systems or physically removing filters or catalytic converters from the exhaust system. Seth: Yes. The aftermarket defeat devices are made to be installed after the vehicles hit the road, typically by vehicle owners and not by the manufacturers themselves. Chad: How widespread is this problem? Seth: No one really knows. In 2020, based on its civil enforcement efforts, the EPA reported its estimate that emissions controls were removed from more than a half a million diesel pickup trucks between 2009 and 2020. That’s about 15 percent of the national volume of diesel trucks originally certified with emissions controls, but it’s important to note that their analysis only considered certain tampered diesel pickup trucks. The actual rate could be as high as 40 percent of all diesel trucks when you consider other types of those vehicles, partially tampered trucks, and manufacturers and distributors of aftermarket defeat devices that the EPA hasn’t identified yet. That 40 percent stat was provided as an estimate by a staff member in the EPA’s Office of Enforcement and Compliance Assurance, which we call OECA. Chad: That sounds substantial. Your report says even just that 15 percent of tampered pickups made up about 75 percent of the emissions released by all diesel trucks. These emissions affect people’s health and the environment, right? Seth: Yes. Excess emissions are linked to higher risk of premature death for people with heart and lung disease. Plus, long-term exposure to these pollutants is associated with an increased risk of cancer and is linked to damage in immune, neurological, and reproductive systems. The EPA says those excess emissions also contain greenhouse gases that contribute to climate change. In terms of air quality, the added emissions are like putting nine million more diesel pickup trucks on the road. Chad: Nine million pickups is huge. Yet this issue seems to have received relatively little public attention. What is the EPA doing about it? Seth: Well, that’s what we wanted to evaluate, since the Agency in fiscal year 2020 made it a national program priority to stop these defeat devices. On a positive note, some officials at the state level told us that they appreciated the work that the EPA’s done to raise awareness of the issue since making it a national priority, which the EPA calls a National Compliance Initiative, or NCI for short. Chad: Let’s talk about that NCI. What does that mean, I guess, in practical terms? Seth: This NCI focuses on stopping the manufacture, sale, and installation of aftermarket defeat devices on vehicles and engines and relies on state outreach to address existing noncompliant vehicles, engines, and equipment. The Agency’s strategic plan has 40 metrics spread across four goals, and many of those metrics can be measured quantifiably. EPA officials believe the Agency has met all the metrics, but we found that 16 out of 25 of the ones that were due in fiscal year 2021—that’s 64 percent of them—were either unmet or too vague to measure for progress. Chad: What gives? Where’s the disconnect? Seth: Some of the issues stem from the coronavirus pandemic and the telework environment, which made some things difficult or impossible, such as getting inspectors to do the in-person training they needed. Or limitations of the pandemic caused the EPA to take a different approach than it had described in its strategic plan, meaning they didn’t meet the metric in the documented plan. But beyond that, there’s also vagueness in how some metrics were written and inconsistencies in how the EPA and regions interpreted the plan. Chad: So, there’s been an unprecedented and unexpected situation with the pandemic, but also some miscommunication. Seth: Yes. We’ve recommended that the EPA provide guidance on interpreting and implementing the plan and addressing some of the vague language issues to get everyone on the same wavelength. We also recommended that OECA set the goals in the NCI strategic plan so that they can be achieved even in the face of a challenge such as pandemics. Chad: I wanted to get back to something you said earlier about feedback you got from the states. What role do the states have in this NCI? Seth: Federal-state partnerships are essential to prevent the registration, use, and resale of tampered vehicles, but the Clean Air Act doesn’t allow the EPA to delegate enforcement of aftermarket defeat devices and tampering in the states, so their complementary efforts are undertaken on a voluntary basis. And the states could do things to augment federal efforts—things that the U.S. EPA itself cannot do. For example, the federal Agency can’t stop the use of individual vehicles that have already been tampered with, but the states might be able to do that. Unfortunately, we learned through interviews and questionnaires distributed to the states that many states have barriers stopping their participation or keeping them from targeting noncompliance. They told us that this had to do with the need for communication or training from the EPA. Chad: Is there anything stopping the EPA from doing more to get these states the help they want? Seth: Yes and no. Again, because the EPA can’t delegate its responsibilities in this area to them, the states are conducting complementary work on a voluntary basis, meaning there’s a patchwork of different laws and programs across the country at that level. Chad: Every state is different. Seth: Yes, every state is different. Some states say they lack legal authorities, which is something outside the EPA’s control. But others say they want better data. EPA officials were wary about data-sharing because of the need to protect personal or confidential business information. But we found that those concerns might be overstated and there may be ways the EPA can share the information while still fulfilling its obligations to protect sensitive information. Offices within the EPA have also been looking at whether they could incorporate incentives to help states address this issue, such as certain credits under the Clean Air Act for reducing excess emissions from aftermarket defeat devices. Some states indicated credits like that might be necessary for them to create state-level programs to combat defeat devices and tampering. Chad: So, while the Agency may be falling short of the strategic plan as it’s written, do we know if its efforts against aftermarket defeat devices have helped improve air quality or curbed the manufacture, sale, and installation of these devices? Seth: No, and that was another issue we identified. OECA’s strategic plan lacks quantifiable deliverables that can show progress toward the NCI’s desired outcomes. That means that the EPA’s impact on the aftermarket defeat devices and tampering market is difficult to determine and that OECA cannot demonstrate the value of its NCI. Chad: Well, it sounds like there’s some work to be done there. How did the EPA respond to your team’s findings? Seth: OECA told us that it’s hard to measure the impact of enforcement activities, but in at least four press releases since 2020, the Agency indicated that it could measure the increase in excess emissions from the aftermarket defeat devices. It also established a possible estimated baseline of noncompliance in the 2020 report about tampered diesel pickup trucks. Plus, it developed an emissions calculator for aftermarket defeat device casework. So, there’s some inconsistency there, and we believe that OECA can use the data it already has—for example, showing a reduction in the half million tampered diesel pickup truck figure—to demonstrate that it’s chipping away at this issue. When we asked how OECA validates claims of tangible success, the then-chair of the NCI Steering Committee cited the decreased visibility of aftermarket defeat devices in online search engines. But that wasn’t a metric documented in the strategic plan. OECA highlighted some of its recent accomplishments in addressing the aftermarket defeat devices issue, such as a record number of civil enforcement cases in 2021 and $33 million in civil penalties assessed in settled cases. The Agency agreed with two of our recommendations for improvement, though its proposed alternative language for one of those recommendations doesn’t quite address our intent. And it disagreed with four of our original recommendations for improvement, such as that it establish quantifiable metrics linked to compliance rates that promote progress, which we discussed earlier. OECA said it would provide training focused on legal requirements for sharing information with the states and proposed some actions to overcome barriers to the states’ voluntary efforts that would be complementary to the NCI. We are continuing to work with the Agency to reach agreement on the recommendations so corrective actions can begin. Chad: Thank you so much for your time discussing this today, Seth. And thank you to our listeners for joining us. You can find the aftermarket defeat devices report and others, along with more podcasts, on our website at www dot epa dot gov slash oig.